Vahdam CEO Bala Sarda, speaking on International Tea Day, urged India to move beyond tea supply and start selling its high-quality tea under indigenous labels. He highlighted the success of foreign brands in capitalizing on this opportunity and emphasized the need for India to follow suit.
Sarda, whose homegrown tea company is making waves internationally with endorsements from notable figures such as Oprah Winfrey, Ellen Degeneres, and Mariah Carey, expressed his disappointment that there are more European brands selling Darjeeling tea and American brands selling Chai worldwide than Indian brands.
“I think we as consumers have always trusted origin products. For example, wine from France and whiskey from Scotland. But for some reason, European brands are selling more Darjeeling tea, and American brands are selling more Chai than any Indian brand was even doing remotely.
“For India to be recognised as a country, which is trusted, which is a superpower we need global brands to come out of India… I think it is just about taking Indian teas through an Indian brand and you know, convincing consumers to have that,” he said.
For the unversed, India holds the distinction of being the world’s second-largest producer and consumer of tea. It commands a significant presence in the global tea industry, accounting for nearly 25-28 percent of the world’s tea production and contributing approximately 10-12 percent to global tea exports.
Sarda noted that despite India’s potential to lead the multi-billion dollar global tea market, the absence of indigenous brands has resulted in the country exporting tea as a “commodity” at meager profit margins. This has allowed foreign importers to package and sell the tea at significantly higher margins, benefiting from the value addition that Indian brands have missed out on for a long time.
With the introduction of brands like Vahdam and others, Sarda highlighted that India is now able to retain the value that was previously being directed to foreign nations.
“You know the average tea export price is nothing more than four and a half dollars per kg. We at Vahdam sell to consumers at multiple times higher price points per kg. And it’s not that consumers were anyways not paying for that. Just the only difference because of a brand like us is that value is retained in India, versus that value which was being spread out in a foreign land,” he explained.
As a fourth-generation entrepreneur with a family legacy of tea retailing and exporting spanning 90 years, Sarda draws inspiration from Sri Lanka and advocates for India to adopt similar strategies to enhance its tea industry.
Sarda pointed out that Sri Lanka, ranked among the top five global tea producers, experienced a similar predicament in the 1980s. However, the rise of local brands like Dilmah and others turned the tide as they took control of the situation and began selling their indigenous tea worldwide.
“I think Sri Lanka is a great example. In the 1980s, they were also exporting their tea as a commodity and all the value was being retained by foreign brands who would take Sri Lankan tea. Later, a plethora of brands came up and took charge and promoted Sri Lankan tea packed in Sri Lanka from Sri Lanka. This helped the industry massively and now the Srilankan tea industry is one of the highest contributors to their GDP,” he said.
Vahdam, with a majority of its business originating from the United States, Canada, and select European countries, currently serves over four million customers in more than 130 countries through its global shipping operations.